Official Summary Text
SB 905, as amended, Becker.
Electricity.
(1) Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations. Existing law authorizes the commission to fix the rates and charges for public utilities and requires that those rates and charges be just and reasonable.
This bill would require the commission, for each electrical corporation, to assign a reduced return on equity, as a reduction applied each year to the then current authorized rate of return on equity, for specified types of capital costs included in the electrical corporation’s rate base, as specified.
(2) Under existing law, it is the policy of the state that each electrical corporation continue to operate its electrical distribution grid in its service territory and
to do so in a safe, reliable, efficient, and cost-effective manner.
This bill would require the commission, on or before January 1, 2028, to initiate a proceeding to investigate, develop, and adopt a framework for performance-based metrics for large electrical corporations, as provided. The bill would authorize the commission to establish targets for each of the performance metrics developed in the proceeding and to assess the performance of the electrical corporation against the performance metrics and any targets during a general rate case, as specified.
The bill would require the commission, on or before January 1, 2030, to initiate a proceeding to evaluate the results of the adopted framework for performance-based metrics for large electrical corporations, as specified.
The bill would require the commission, on or before January 1, 2028, to require each
large electrical corporation to have an incentive compensation structure for certain employees for which a minimum of 20% of their total compensation each year is contingent on the average cost of electricity, as specified.
This bill would require the commission to initiate a rulemaking proceeding to evaluate opportunities for alternative methods of financing capital investments in electrical distribution, electrical generation, and electrical transmission that reduce costs for ratepayers, as specified. As part of the rulemaking, the bill would require the commission to require each electrical corporation to annually submit a report identifying all opportunities for alternative financing of electrical distribution, electrical generation, and electrical transmission costs. The bill would require the commission, on or before December 31, 2028, to submit a report to the Legislature outlining any findings and recommendations resulting from the rulemaking.
This bill would require the commission to require each large electrical corporation to make data available to the public that quantifies the potential for increased utilization of segments of its electrical distribution grid by reducing peak load, as specified.
(3) Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because the above provisions would be a part of the act, and because a violation of a commission action implementing those provisions would be a crime, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making
that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.